An important difference between the two is that a draft can
be issued only when the amount of the draft is submitted to
the bank. Whereas a cheque can be issued irrespective of
whether there is balance in the issuer's account or not.
Incase there is no balance in the issuer's account at the
time when the cheque is presented to the bank for
encashment, the cheque will get bounced.
Cheque and DD, both are negotiable instruments and to be
honored. But the basic diffrence is, check will be issued
by an account holder and whereas DD can be issued by a
banker only.... Cheque may get rejected due to lot many
reasons....but DD will not get rejected if u present.
(Some DDs were not accepted by Scheduled commercial banks,
as the DDs were issued by some problematic Co-op banks.
There are some other differences too.
The basic diffrence between the cheque and draft is that.
cheque is like postpaid and the draft is like prepaid.
means if you need to create the draft u have to pay first
to bank then bank will issue the draft. and in case of
cheque it is not needed that your account must have the
following are the differences between cheque&draft
1 cheque is a negotiable 1 draft is also nego
instrument which is ordering tiable instrument
to pay certain some of amount which demands to
to certain person pay the amount
For issuing cheques, there wont be any commission if it is
to be transacted in the same bank. But for getting as well
as for cancelling the DD, we need to pay commission. DD can
be acquired from the bank by paying the required amount for
that, whereas the cheque will be worthful only when the
indicated amount is available in your savings account.
otherwise the cheque will bounce.
DD can be used by any unauthorised person if it is not
mentioned as account payee only.
a draft is simply a conversion of money to a negotiable
instrument a draft cannot be issued without money where as
a cheque can be issued without sufficent balance in your
account later it may be liable for criminal liability.
Assume we have taken a vehicle on leasing Cost Of vehicle
Rs.2445000 (vat 261964.00)on 22/12/09 ,the vecle lease for
4 years and made intial paymenent as Rs.25000 &the monthly
leasing amount Rs.59806.00,pls let me know the double
entries for this finacial year (with figers)